Developers for Sherwood Shopping Center are expected to receive a $1.4 million loan from the city of Troy through city’s Community Improvement Corporation to redevelop the site on the city’s north sied. STEVE BAKER/STAFF

Troy takes next toward steering $1.4M loan to shopping center developers

Troy’s Community Improvement Corporation agreed Thursday, April 19, to accept $1.4 million in loans from the city and then loan that money to a partnership looking to redevelop the nearly vacant Sherwood Shopping Center on the city’s north side.

The bulk of the work agreed to by the CIC would be contingent on approval of the loan by Troy City Council. The request is expected to be submitted to council’s finance committee, which would make a recommendation to the full council. The CIC is an organization formed in the 1970s to assist in economic development projects. It is made up of business and government leaders.

A council vote on the loans to Sherwood of Troy LLC – a partnership of developer Frank Harlow along with Mark Earhart and Scott Earhart, all area residents – could come as early as May 7.

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Plans by the partnership to buy the center from its current owners in New York were announced in March when a city loan committee reviewed and supported the proposed loans contingent on approval by auditors/legal advisers. The CIC was asked to become involved when advisers had several concerns and the city law director suggested using the CIC, said Patrick Titterington, city service and safety director.

Harlow said at an earlier meeting that the partners planned a $2.3 million project with $1.7 million for purchase and $600,000 for building stabilization work including a roof. In addition to $600,000 for the stabilization, the investors proposed $300,000 in private equity toward the purchase. The city money, if approved, would be for a $900,000 two-year loan with interest only payments at 3 percent and a $500,000 loan for 20 years at 4.5 percent.

Collateral would be mortgages on the center and the partners’ personal guarantees.

Harlow said Thursday he has a restaurant looking at 10,000 square feet of center and has had other inquiries about leasing in an updated center. “I think it’s going to be a great thing for the northeast section of Troy,” he said.

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CIC member Mark Douglas, a local banking executive, told Harlow, “We appreciate your willingness to take on this project.”

The CIC approved 11 motions, most contingent on council’s approval. Three agreements were approved without that condition. They are for legal services such as title search/closing transactions; an environmental site assessment of the shopping center; and a property mortgage survey.

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